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Cardano’s founder, Charles Hoskinson, has clarified why the blockchain platform was excluded from a prominent US government initiative meant to publish official economic data on public blockchains. Blockchain networks like Ethereum, Solana, Avalanche, and Optimism made the cut; Cardano didn’t. Hoskinson revealed during a YouTube AMA that the reason wasn’t technical or regulatory, but it was grounded in economics. Specifically, he said the integration fee quoted by Oracle specialist Chainlink was absurd, which made Cardano’s participation really unfeasible.
Chainlink’s Absurd Fee
As one of the biggest blockchain ecosystems, Cardano’s inability to participate in the US government’s recent blockchain initiative to bring macroeconomic data onto the blockchain took many crypto participants by surprise. However, while speaking at a recent surprise AMA on his YouTube channel, Cardano founder Charles Hoskinson says the reason boils down to money.
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According to Hoskinson, the main reason was due to its pending partnership with Chainlink’s oracle integration, which is yet to be finalised because of the absurd fee charged by Chainlink. Hoskinson did not shy away from strong language: “They gave us an absurd number for integration. I said ‘f– it, we’ll handle it. We’ll figure it out,’” he said.
Despite the frustration, he tempered his critique with respect. He described Chainlink co-founder Sergey Nazarov as “extremely smart” and “a very good businessman”, someone who “sees the future” and, in Hoskinson’s words, is “sitting on a golden egg”.
Chainlink’s oracle solutions are very important for connecting smart contracts to real-world data. As such, Hoskinson’s metaphor acknowledges Chainlink’s powerful position in the blockchain ecosystem.
How It Stalls Cardano’s DeFi Growth
Without a cost-effective oracle integration, Cardano’s decentralized finance landscape has struggled to keep pace with other blockchain ecosystems. To put this into perspective, Ethereum’s integration with Chainlink has allowed large inflows into its DeFi ecosystem, with about $13.4 billion in Total Value Locked (TVL) added from between August 2 ($78.222 billion) and August 31 ($91.595 billion), according to data from DeFiLlama.
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Meanwhile, Cardano’s TVL broke below $400 million in August, and daily active addresses have also fallen massively. At the time of writing, Cardano’s TVL is sitting at $367.91 million. The result is a disconnect between Cardano’s on-chain activity and ADA’s price action, which witnessed a steady increase in August alongside the rest of the crypto market.
Nonetheless, Hoskinson is still optimistic. Talks with Chainlink are ongoing, and he’s determined to find common ground with Chainlink. He also revealed discussions with the team behind the USD1 stablecoin and hinted at potential collaboration with Aave, which he described as part of a bundle. If USD1 (already launched on Ethereum, BNB, and Tron) comes to Cardano, it could become the ecosystem’s largest stablecoin. Combine that with oracle access and lending support from Chainlink, and Cardano could strengthen its DeFi foundations significantly.
At the time of writing, Cardano is trading at $0.8307, up by 1.1% in the past 24 hours.
Featured image from Adobe Stock, chart from Tradingview.com
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Scott Matherson
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